Australia's markets regulator is suing Block Earner, alleging that the fintech company provided unlicensed financial services.
The Australian Securities and Investments Commission (ASIC) said Block Earner offered a range of fixed-yield earning products based on crypto assets, according to a statement from the commission Wednesday. The products should have been licensed because they are a managed investment scheme, "leaving consumers without important protections," it said.
"Although we understand the backdrop, this is a disappointing outcome," said Block Earner co-founder and CEO Charlie Karaboga in a statement to Business News Australia. Karaboga said since inception, customers' funds have been protected against events like the recent collapse of crypto exchange FTX and that a lack of regulatory clarity "creates friction between regulators and innovators."